Revolut chief denies ‘money laundering’ allegations

Revolut premium bank cards. (source: Official Facebook page of Revolut)

Updated on

Nikolay Storonsky, the founding CEO of digital banking startup Revolut, denied news reports suggesting that his company would have been involved in activities raising the issue of possible “money laundering”, according to a blog post he just published on the official blog of the bank. He also says no connection can be found between the resignation of his company’s finance chief and the alleged “money laundering” despite what the reports suggest.

Mr Storonosky claims that last July Revolut rolled out a “more advanced sanctions screening system in parallel” with existing controls, as an attempt to improve their system and processes. However, being unsatisfied with the results of the initial tests, Revolut decided to temporarily revert to existing controls.

“At no point during this time did we fail to meet our legal or regulatory requirements,” Mr Storonosky writes in his blog entry. “We conducted a thorough review of all transactions that were processed during this time, which confirmed that there were no breaches.” The founding CEO insists that no breach of any sanctions or money laundering laws and requirements occurred, therefore they did not send a formal notification to the regulator.

READ  GO ‘quickly recovers’ from DDoS causing brief technical hiccups

The Telegraph broke news on 28 February that Revolut was “accused of violating basic banking rules by failing to block thousands of potentially suspicious transactions on its platform,” the report writes. Citing documents The Telegraph says had acquired, the online daily reports Revolut switched off its system flagging suspicious transfers.

Less than a day after Revolut made headlines accompanied by the words “money laundering”, CFO Peter O’Higgins resignation roared through the media, in some places appearing to suggest connections between the two. Mr O’Higgins had been with the company since 2016.

“Yesterday, it was reported that my friend, Peter O’Higgins, would be stepping down as our Chief Financial Officer after three years at the helm. During his time with us, Peter has scaled our operations and expanded our team from 20 to over 800 people,” the Revolut chief writes in the blog post.

READ  Revolut signs up 120,000 customers in Malta and counting

“Unfortunately, the news of Peter’s decision to resign was caught up in the above recent media coverage on our compliance enhancement roll-out. Any suggestion that Peter’s resignation is in any way, shape or form connected to this roll-out is utterly false and damaging. Peter has since expressed to me that he has been hurt by this suggestion and sad that his departure has been tainted in this way,” Mr Storonosky writes.

He also adds that Mr O’Higgins resigned because he feels that “the business will require someone with global retail banking experience as we prepare to apply to become a licensed bank in multiple jurisdictions,” Mr Storonosky without elaborating on the qualities of the future financial chief.

READ  Seasonally-adjusted industrial turnover grows 0.8% in Q2

The mobile application-based online banking services of Revolut have been spreading sporadically in the Maltese market, and their payment method is used regularly by locals.